Financial statements for Larned Company appear below: Dividends during Year 2 totaled $263 thousand, of which $12 thousand were preferred dividends.
The market price of a share of common stock on December 31, Year 2 was $160.

-Larned Company's earnings per share of common stock for Year 2 was closest to:
A)$18.39
B)$27.22
C)$19.06
D)$11.03

Question

Financial statements for Larned Company appear below:   Dividends during Year 2 totaled $263 thousand, of which $12 thousand were preferred dividends.
The market price of a share of common stock on December 31, Year 2 was $160.

-Larned Company's earnings per share of common stock for Year 2 was closest to:
A)$18.39 
B)$27.22 
C)$19.06 
D)$11.03

Quizplus · Accepted Answer

Number of common shares outstanding = Common stock F1F1F1S1F1F1F10 Par value
= $180 F1F1F1S1F1F1F10 $10 per share = 18 shares
Earnings per share = (Net Income - Preferred Dividends)
F1F1F1S1F1F1F10 Average number of common shares outstanding
= ($343 - $12)F1F1F1S1F1F1F10 (18 shares + 18 shares)/2 = $18.39 per share

Financial Statements for Larned Company Appear Below: Dividends